Alpha This Week - reports.ambitcapital.comreports.ambitcapital.com/reports/Ambit_AlphaThisWeek_29Sept2015.pdf · Kotak Mah Bank ( ) ( ) IDFC ( ) the next Titan ( ) ... after

Ambit Capital and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, investors should be aware that Ambit Capital may have a conflict of interest that could affect the objectivity of this report. Investors should not consider this report as the only factor in making their investment decision.

Alpha This Week

September 29, 2015

Derivatives

Securities featured in this note

Company Near Term

Medium term

Nifty () ()

Kotak Mah Bank () ()

IDFC () <->

Titan () ()

TCS () ()

HCL Tech () ()

ITC () ()

() denotes positive view, () denotes negative view, <-> denotes no major view/ consolidation. Analyst Details

Prashant Mittal, CFA Tel: +91 22 3043 3218 [email protected]

Gaurav Mehta, CFA Tel: +91 22 3043 3255 [email protected]

An alternative take on the markets 17th Sept 2013 In line with our view, the Nifty was unable to sustain its upmove and reverted to lower levels after facing huge resistance at 8000 levels. The current leg, in our view, is likely to take the index towards the 7200-7500 region. We believe with a multitude of resistances starting at 8000 and going up to 8200, any relief rallies are unlikely to materialise into meaningful upsides. This view is further reinforced by the recent price action in S&P500 which suggests that US stocks may have already begun the next leg lower. On stocks, we initiate fresh shorts on IDFC and continue with shorts on Kotak Mahindra Bank. On the long side, Titan, TCS, HCL Tech and ITC continue to look attractive. We advise exiting shorts on Mahindra and Mahindra.

Index: The Nifty was unable to sustain its upmove and reverted to lower levels after facing huge resistance at 8000 levels. The current leg, in our view, is likely to take the index towards the 7200-7500 region. We believe with a multitude of resistances starting at 8000 and going up to 8200, any relief rallies are unlikely to materialise into meaningful upsides.

Stocks: On stocks, we initiate fresh shorts in IDFC and continue with shorts on Kotak Mahindra Bank. On the long side, Titan, TCS, HCL Tech and ITC continue to look attractive. We advise exiting shorts on Mahindra and Mahindra.

Nifty – Resistance holding strong!

Source: Metastock

FIIs in index derivatives: FIIs’ index futures positions, even after the moderation of last week, continue to be in the net long territory, still far from extreme pessimistic levels. Net protection bought by FIIs (net puts minus net calls), after the reduction last week in tandem with the net futures longs moderation, does not suggest peak pessimism either.

Institutional flows: FIIs continued being SELLers of Indian equities last week and sold equities worth Rs23bn. Overall, since May 2015, FIIs have sold Indian equities worth Rs408bn. DIIs, on the other hand, continued being BUYers and have bought equities worth Rs467bn since May 2015. Further, DIIs, as a class, are currently buyers of Indian equities worth Rs455bn since the General Elections in May 2014. MFs have bought equities worth Rs877bn since the elections, indicating robust retail inflows which have been, in part, offset by outflows driven by insurance selling.

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 2

Index Nifty – Resistance holding strong!

Source: Metastock

The Nifty was unable to sustain its upmove last week, topping out near the huge resistance at 8000 marked by the bearish Head & Shoulders (H&S) pattern neckline that it had broken down from in late-August.

On the back of continued strength of this resistance, we believe that further downside exists until the 7200-7500 region on the index.

On the way up, any relief rallies are likely to face significant resistance from a number of factors: the neckline of the H&S at 8000, the recent highs having failed at 8100 and gap resistance on daily charts in the 8225-8060 region.

Nifty – 7200 is a strong long-term support!

Source: Metastock; Note: This is a quarterly log chart of the Nifty

On a longer-term basis, the Nifty continues to be in a bull market ever since the 6350 breakout; further, the structural uptrend that began in 2003 is still intact on the Nifty (on log, quarterly charts).

Therefore, the long-term uptrend in Indian equities stays intact and the region around 7200 should act as the absolute floor even in the worst case.

Nifty – More downsides ahead!

Structural uptrend stays intact!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 3

Bank Nifty – Back near critical resistance!

Source: Metastock

In line with our view, the Bank Nifty was unable to sustain its charge above the key trendline resistance near the 17,100-17,200 levels last week and has come back to these levels. We expect it to drift lower (in line with our Nifty view) and target the region closer to 16000 on the way down.

Bank Nifty – Likely to see lower levels with recovery fizzling out!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 4

S&P 500 – Resuming next leg lower?

Source: Metastock

The entire bull market in the S&P500 since early 2009 had been defined by a rising wedge formation. We had been voicing a note of caution on the index in the light of negative technical implications of such a formation. In line with our view, the S&P500 corrected sharply, marking the resolution of the wedge pattern and exposing the index to significant downsides.

Having spent about a month in the consolidation phase marked by a pennant formation (bottom chart), the index looks like it has resumed the next leg of its downward movement and is expected to see much lower levels going ahead.

S&P – Resolution of consolidation pattern likely to lead to significant downsides

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 5

Stocks IDFC – Short

Source: Metastock

IDFC’s stock has been trading in a downward trending channel since February 2015 and currently trades near the upper end of this channel. Given the downward trend of the channel and the likely resistance from the trendline at the upper end of the channel, the stock is expected to drift lower in the coming days.

We therefore initiate shorts on the stock for downside targets near 120 (CMP of 140) and stop loss above 145.

Kotak Mahindra Bank – Stay short

Source: Metastock

Kotak Mahindra Bank’s stock had been trading in a channel since January 2015. Last month, this stock broke down below the lower end of this channel and has found resistance from this trendline since.

Further, the MACD shows negative divergence, with lower highs being formed alongside higher highs on the price chart.

After a brief threat to move back into the channel last week, the stock eventually failed to do so and reverted to lower levels. We believe it will continue to find resistance at the lower end of the channel and advise continuing shorts for downside targets near 590 (CMP of 641) and stop loss above 665; we are bottom-up SELLers on the stock as well.

Short IDFC!

Stay short Kotak Mahindra Bank!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 6

Titan – Stay long

Source: Metastock

Titan had been trading downwards in a falling wedge pattern since early this year before breaking out of this pattern towards the mid of August; this is a significant technical positive.

Further, the MACD continues to show a positive divergence, with higher highs being formed alongside lower highs on the price chart.

On the back of these positive technical indicators, we recommend continuing longs on the stock for upside targets near 370 and stop loss below 310.

TCS – Stay long

Source: Metastock

After the strong run-up in the stock until the middle of 2014, the stock has been in a sideways consolidation over the past several months, suggesting that the upmove should resume post a resolution of this consolidation.

We recommend continuing longs on the stock with stop loss below 2480, denoting the lower trendline of the consolidation pattern; on the way up, a break above 2740, the upper end of the pattern, is likely to lead to an upmove towards 2900-3000; we are bottom-up BUYers on the stock as well.

Stay long Titan!

Stay long TCS!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 7

HCL Tech – Stay long

Source: Metastock

We initiated longs on HCL Tech in May 2015 on the back of a strong trendline support (near 900 at the time).

We recommend continuing longs on the stock with stop loss below 920; on the way up, a move above 980 is likely to lead the stock towards 1100 in the medium term; we are bottom-up BUYers on the stock as well.

ITC – Stay long

Source: Metastock

We have been buyers of this stock on the back of a strong long-term trendline support in the 295-305 region.

We recommend continuing longs on the stock with stop loss below 295 and with potential upsides in the range of 375-380; we are bottom-up BUYers on the stock as well.

Continue HCL Tech longs for targets of 1100!

Staying long ITC!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 8

Mahindra and Mahindra – Exit shorts

Source: Metastock

M&M’s uptrend had been repeatedly stalled by a trendline since early 2007; however, the stock finally broke out of this trendline resistance in May 2014 and then found support at that trendline on subsequent declines. We initiated shorts on the stock after it broke down below this strong trendline during last month’s sharp correction.

Last week, however, the stock broke out above this trendline and in the process triggered our stop loss at 1212. Hence, we advise exiting the shorts on the stock.

Exit shorts on Mahindra & Mahindra!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 9

FIIs in derivatives Derivatives positions – Not at pessimistic extremes yet! Exhibit 1: FII index futures positions

Source: Ambit Capital research, NSE website

Exhibit 2: FII index options positions

Source: Ambit Capital research, NSE website

FII index futures activity: FIIs’ index futures positions continue to be in the net long category; however, the quantum of the same has reduced in the last week. Although a reduction in these positions denotes some moderation of complacency, these positons are still far from the extreme pessimistic levels.

FII index options activity: Net protection bought by FIIs (net puts minus net calls) reduced last week but still hovers in the middle of the historical range and does not suggest peak pessimism yet.

Stock futures – Arbitrage positions retreat

Exhibit 3: FII stock future positions vs INR hedge cost

Source: Ambit Capital research, NSE website

FIIs are short stock futures in general to exploit the cash-future arbitrage opportunity; usually arbitrage positions are inversely correlated to INR hedge cost.

With the INR hedge cost declining and with G-Sec yields declining as well, these positions had been steadily rising until the beginning of 2015.

However, these positions have sharply come off over the six months even as the rise in hedge cost has been pretty modest; a part of this may be due to a reduction in the arbitrage spreads thanks to the growing size of domestic equity arbitrage funds, suggesting more money is exploiting the same opportunity.

(400,000)

(200,000)

-

200,000

400,000

600,000

800,000

Jan-

12M

ar-1

2M

ay-1

2Ju

l-12

Sep-

12

Nov

-12

Jan-

13M

ar-1

3M

ay-1

3Ju

l-13

Sep-

13

Nov

-13

Jan-

14M

ar-1

4M

ay-1

4Ju

l-14

Sep-

14

Nov

-14

Jan-

15M

ar-1

5M

ay-1

5Ju

l-15

Sep-

15

net l

ong

open

inte

rest

(no.

of

cont

ract

s, in

dex

futu

res)

(500,000)

-

500,000

1,000,000

1,500,000

2,000,000

Jan-

12M

ar-1

2M

ay-1

2Ju

l-12

Sep-

12

Nov

-12

Jan-

13M

ar-1

3M

ay-1

3Ju

l-13

Sep-

13

Nov

-13

Jan-

14M

ar-1

4M

ay-1

4Ju

l-14

Sep-

14

Nov

-14

Jan-

15M

ar-1

5M

ay-1

5Ju

l-15

Sep-

15

net p

uts

min

us n

et c

alls

2%4%6%8%10%

12%14% (1,400,000)

(1,200,000) (1,000,000)

(800,000) (600,000) (400,000) (200,000)

- 200,000

Jan-

12M

ar-1

2M

ay-1

2Ju

l-12

Sep-

12

Nov

-12

Jan-

13M

ar-1

3M

ay-1

3Ju

l-13

Sep-

13

Nov

-13

Jan-

14M

ar-1

4M

ay-1

4Ju

l-14

Sep-

14

Nov

-14

Jan-

15M

ar-1

5M

ay-1

5Ju

l-15

Sep-

15

INR hedge cost proxy (N

DF

1m-2m

spread annualized)

FII s

tock

futu

re n

et s

hort

co

ntra

cts

Net Future Stock position INR Hedge Cost

FIIs’ derivatives positions do not suggest climactic pessimism yet!

FIIs’ cash futures positions have come off sharply over the past six months!

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 10

India equity flows Weekly flows

Exhibit 4: Weekly FII and DII cash equity flows

Source: Ambit Capital research

FIIs continued being SELLers of Indian equities last week; they were sellers of equities worth Rs23bn.

For the month of September, FIIs have sold Indian equities worth Rs96bn thus far. Overall, since May 2015, FIIs have sold Indian equities worth Rs408bn.

Monthly flows

Exhibit 5: Monthly FII and DII cash equity flows

Source: Ambit Capital research

DIIs continued being BUYers of Indian equities and bought equities worth Rs14bn last week.

For the month of September, DIIs have bought Indian equities worth Rs91bn thus far. Overall, since May 2015, DIIs have bought Indian equities worth Rs467bn.

DIIs, as a class, are currently buyers of Indian equities worth Rs455bn since the General Elections in May 2014. MFs have bought equities worth Rs877bn since the elections, indicating robust retail inflows which have been, in part, offset by outflows driven by insurance selling.

(150)

(100)

(50)

-

50

100

150

3-A

pr-1

5

17-A

pr-1

5

1-M

ay-1

5

15-M

ay-1

5

29-M

ay-1

5

12-J

un-1

5

26-J

un-1

5

10-J

ul-1

5

24-J

ul-1

5

7-A

ug-1

5

21-A

ug-1

5

4-Se

p-15

18-S

ep-1

5Rs b

n

Flows- Weekly

FII Flows DII Flows

(200)

(100)

-

100

200

300

Apr

-13

Jun-

13

Aug

-13

Oct

-13

Dec

-13

Feb-

14

Apr

-14

Jun-

14

Aug

-14

Oct

-14

Dec

-14

Feb-

15

Apr

-15

Jun-

15

Aug

-15

Rs b

n

Flows- Monthly

FII Flows DII Flows

FIIs continued SELLing Indian equities last week…

…whilst DIIs continued being BUYers of the same

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 11

Institutional Equities Team Saurabh Mukherjea, CFA CEO, Institutional Equities (022) 30433174 [email protected]

Research

Analysts Industry Sectors Desk-Phone E-mail

Nitin Bhasin - Head of Research E&C / Infra / Cement / Industrials (022) 30433241 [email protected]

Aadesh Mehta, CFA Banking / Financial Services (022) 30433239 [email protected]

Abhishek Ranganathan, CFA Retail / Mid-caps (022) 30433085 [email protected]

Achint Bhagat, CFA Cement / Roads / Home Building (022) 30433178 [email protected]

Aditya Bagul Consumer (022) 30433264 [email protected]

Aditya Khemka Healthcare (022) 30433272 [email protected]

Ashvin Shetty, CFA Automobile (022) 30433285 [email protected]

Bhargav Buddhadev Power Utilities / Capital Goods (022) 30433252 [email protected]

Deepesh Agarwal Power Utilities / Capital Goods (022) 30433275 [email protected] Gaurav Mehta, CFA Strategy / Derivatives Research (022) 30433255 [email protected]

Girisha Saraf Mid-caps / Small-caps (022) 30433211 [email protected]

Karan Khanna Strategy (022) 30433251 [email protected]

Kushank Poddar Technology (022) 30433203 [email protected] Pankaj Agarwal, CFA Banking / Financial Services (022) 30433206 [email protected]

Paresh Dave, CFA Healthcare (022) 30433212 [email protected]

Parita Ashar, CFA Metals & Mining (022) 30433223 [email protected]

Prashant Mittal, CFA Derivatives (022) 30433218 [email protected]

Rakshit Ranjan, CFA Consumer (022) 30433201 [email protected]

Ravi Singh Banking / Financial Services (022) 30433181 [email protected]

Ritesh Gupta, CFA Oil & Gas / Chemicals (022) 30433242 [email protected]

Ritesh Vaidya, CFA Consumer (022) 30433246 [email protected] Ritika Mankar Mukherjee, CFA Economy / Strategy (022) 30433175 [email protected]

Ritu Modi Automobile (022) 30433292 [email protected]

Sagar Rastogi Technology (022) 30433291 [email protected]

Sumit Shekhar Economy / Strategy (022) 30433229 [email protected]

Utsav Mehta, CFA E&C / Industrials (022) 30433209 [email protected]

Sales

Name Regions Desk-Phone E-mail

Sarojini Ramachandran - Head of Sales UK +44 (0) 20 7614 8374 [email protected]

Dharmen Shah India / Asia (022) 30433289 [email protected]

Dipti Mehta India / USA (022) 30433053 [email protected]

Hitakshi Mehra India (022) 30433204 [email protected]

Krishnan V India / Asia (022) 30433295 [email protected]

Nityam Shah, CFA USA / Europe (022) 30433259 [email protected]

Parees Purohit, CFA UK / USA (022) 30433169 [email protected]

Praveena Pattabiraman India / Asia (022) 30433268 [email protected]

Shaleen Silori India (022) 30433256 [email protected]

Singapore

Pramod Gubbi, CFA – Director Singapore +65 8606 6476 [email protected]

Shashank Abhisheik Singapore +65 6536 1935 [email protected]

USA / Canada

Ravilochan Pola - CEO Americas +1(646) 361 3107 [email protected]

Production

Sajid Merchant Production (022) 30433247 [email protected]

Sharoz G Hussain Production (022) 30433183 [email protected]

Joel Pereira Editor (022) 30433284 [email protected]

Nikhil Pillai Database (022) 30433265 [email protected]

E&C = Engineering & Construction

Alpha This Week

September 29, 2015 Ambit Capital Pvt Ltd Page 12

Explanation of Investment Rating

Investment Rating Expected return (over 12-month)

BUY >10%

SELL <10%

NO STANCE We have forward looking estimates for the stock but we refrain from assigning valuation and recommendation

UNDER REVIEW We will revisit our recommendation, valuation and estimates on the stock following recent events

NOT RATED We do not have any forward looking estimates, valuation or recommendation for the stock

Disclaimer This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Ambit Capital. AMBIT Capital Research is disseminated and available primarily electronically, and, in some cases, in printed form.

Additional information on recommended securities is available on request.

Disclaimer

1. AMBIT Capital Private Limited (“AMBIT Capital”) and its affiliates are a full service, integrated investment banking, investment advisory and brokerage group. AMBIT Capital is a Stock Broker, Portfolio Manager and Depository Participant registered with Securities and Exchange Board of India Limited (SEBI) and is regulated by SEBI

2. AMBIT Capital makes best endeavours to ensure that the research analyst(s) use current, reliable, comprehensive information and obtain such information from sources which the analyst(s) believes to be reliable. However, such information has not been independently verified by AMBIT Capital and/or the analyst(s) and no representation or warranty, express or implied, is made as to the accuracy or completeness of any information obtained from third parties. The information, opinions, views expressed in this Research Report are those of the research analyst as at the date of this Research Report which are subject to change and do not represent to be an authority on the subject. AMBIT Capital may or may not subscribe to any and/ or all the views expressed herein.

3. This Research Report should be read and relied upon at the sole discretion and risk of the recipient. If you are dissatisfied with the contents of this complimentary Research Report or with the terms of this Disclaimer, your sole and exclusive remedy is to stop using this Research Report and AMBIT Capital or its affiliates shall not be responsible and/ or liable for any direct/consequential loss howsoever directly or indirectly, from any use of this Research Report.

4. If this Research Report is received by any client of AMBIT Capital or its affiliate, the relationship of AMBIT Capital/its affiliate with such client will continue to be governed by the terms and conditions in place between AMBIT Capital/ such affiliate and the client.

5. This Research Report is issued for information only and the 'Buy', 'Sell', or ‘Other Recommendation’ made in this Research Report such should not be construed as an investment advice to any recipient to acquire, subscribe, purchase, sell, dispose of, retain any securities and should not be intended or treated as a substitute for necessary review or validation or any professional advice. Recipients should consider this Research Report as only a single factor in making any investment decisions. This Research Report is not an offer to sell or the solicitation of an offer to purchase or subscribe for any investment or as an official endorsement of any investment.

6. This Research Report is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied in whole or in part, for any purpose. Neither this Research Report nor any copy of it may be taken or transmitted or distributed, directly or indirectly within India or into any other country including United States (to US Persons), Canada or Japan or to any resident thereof. The distribution of this Research Report in other jurisdictions may be strictly restricted and/ or prohibited by law or contract, and persons into whose possession this Research Report comes should inform themselves about such restriction and/ or prohibition, and observe any such restrictions and/ or prohibition.

7. Ambit Capital Private Limited is registered as a Research Entity under the SEBI (Research Analysts) Regulations, 2014.

Conflict of Interests

8. In the normal course of AMBIT Capital’s business circumstances may arise that could result in the interests of AMBIT Capital conflicting with the interests of clients or one client’s interests conflicting with the interest of another client. AMBIT Capital makes best efforts to ensure that conflicts are identified and managed and that clients’ interests are protected. AMBIT Capital has policies and procedures in place to control the flow and use of non-public, price sensitive information and employees’ personal account trading. Where appropriate and reasonably achievable, AMBIT Capital segregates the activities of staff working in areas where conflicts of interest may arise. However, clients/potential clients of AMBIT Capital should be aware of these possible conflicts of interests and should make informed decisions in relation to AMBIT Capital’s services.

9. AMBIT Capital and/or its affiliates may from time to time have or solicit investment banking, investment advisory and other business relationships with companies covered in this Research Report and may receive compensation for the same.

Additional Disclaimer for U.S. Persons

10. The research report is solely a product of AMBIT Capital 11. AMBIT Capital is the employer of the research analyst(s) who has prepared the research report 12. Any subsequent transactions in securities discussed in the research reports should be effected through Enclave Capital LLC. (“Enclave”). 13. Enclave does not accept or receive any compensation of any kind for the dissemination of the AMBIT Capital research reports. 14. The research analyst(s) preparing the email / Research Report/ attachment is resident outside the United States and is/are not associated persons of any U.S. regulated broker-dealer and that

therefore the analyst(s) is/are not subject to supervision by a U.S. broker-dealer, and is/are not required to satisfy the regulatory licensing requirements of FINRA or required to otherwise comply with U.S. rules or regulations regarding, among other things, communications with a subject company, public appearances and trading securities held by a research analyst account.

15. This report is prepared, approved, published and distributed by the Ambit Capital located outside of the United States (a non-US Group Company”). This report is distributed in the U.S.by Enclave Capital LLC, a U.S. registered broker dealer, on behalf of Ambit Capital only to major U.S. institutional investors (as defined in Rule 15a-6 under the U.S. Securities Exchange Act of 1934 (the “Exchange Act”)) pursuant to the exemption in Rule 15a-6 and any transaction effected by a U.S. customer in the securities described in this report must be effected through Enclave Capital LLC (19 West 44th Street, suite 1700, New York, NY 10036).

16. As of the publication of this report Enclave Capital LLC, does not make a market in the subject securities. 17. This document does not constitute an offer of, or an invitation by or on behalf of Ambit Capital or its affiliates or any other company to any person, to buy or sell any security. The information

contained herein has been obtained from published information and other sources, which Ambit Capital or its Affiliates consider to be reliable. None of Ambit Capital accepts any liability or responsibility whatsoever for the accuracy or completeness of any such information. All estimates, expressions of opinion and other subjective judgments contained herein are made as of the date of this document. Emerging securities markets may be subject to risks significantly higher than more established markets. In particular, the political and economic environment, company practices and market prices and volumes may be subject to significant variations. The ability to assess such risks may also be limited due to significantly lower information quantity and quality. By accepting this document, you agree to be bound by all the foregoing provisions.

Additional Disclaimer for Canadian Persons

18. AMBIT Capital is not registered in the Province of Ontario and /or Province of Québec to trade in securities and/or to provide advice with respect to securities. 19. AMBIT Capital's head office or principal place of business is located in India. 20. All or substantially all of AMBIT Capital's assets may be situated outside of Canada. 21. It may be difficult for enforcing legal rights against AMBIT Capital because of the above. 22. Name and address of AMBIT Capital's agent for service of process in the Province of Ontario is: Torys LLP, 79 Wellington St. W., 30th Floor, Box 270, TD South Tower, Toronto, Ontario M5K 1N2

Canada. 23. Name and address of AMBIT Capital's agent for service of process in the Province of Montréal is Torys Law Firm LLP, 1 Place Ville Marie, Suite 1919 Montréal, Québec H3B 2C3 Canada.

Additional Disclaimer for Singapore Persons 24. This Report is prepared and distributed by Ambit Capital Private Limited and distributed as per the approved arrangement under Paragraph 9 of Third Schedule of Securities and Futures Act (CAP 289)

and Paragraph 11 of the First Schedule to the Financial Advisors Act (CAP 110) provided to Ambit Singapore Pte. Limited by Monetary Authority of Singapore. 25. This Report is only available to persons in Singapore who are institutional investors (as defined in section 4A of the Securities and Futures Act (Cap. 289) of Singapore (the “SFA”).” Accordingly, if a

Singapore Person is not or ceases to be such an institutional investor, such Singapore Person must immediately discontinue any use of this Report and inform Ambit Singapore Pte. Limited.

Disclosure 26. Ambit and/or its associates have financial interest in Kotak Mahindra Bank. 27. Ambit and/or it associates have received compensation for investment banking/merchant banking/brokering services from IDFC in the past 12 months.

Analyst Certification Each of the analysts identified in this report certifies, with respect to the companies or securities that the individual analyses, that (1) the views expressed in this report reflect his or her personal views about all of the subject companies and securities and (2) no part of his or her compensation was, is or will be directly or indirectly dependent on the specific recommendations or views expressed in this report. © Copyright 2015 AMBIT Capital Private Limited. All rights reserved.

Ambit Capital Pvt. Ltd. Ambit House, 3rd Floor. 449, Senapati Bapat Marg, Lower Parel, Mumbai 400 013, India. Phone: +91-22-3043 3000 | Fax: +91-22-3043 3100 CIN: U74140MH1997PTC107598 www.ambitcapital.com